Spotlight on Surveillance

January
2006:Legality of NSA’s Secret Eavesdropping Program Is Suspect
and Cost is Unknown

The federal government is spending an increasing amount of taxpayer money
on surveillance technology and projects at the expense of other government
programs. EPIC’s “Spotlight on Surveillance” scrutinizes
these surveillance projects. For more information, see previous
Spotlights on Surveillance.

Last month, the New York Times reported that President George W. Bush
had issued an order in 2002 allowing the National Security Agency unprecedented
authority to conduct domestic surveillance.1 This month, the National Security Agency, the
largest intelligence organization in the federal government, is under the
Spotlight.

Applications
for secret surveillance hit an all-time high in 2004,
and not
one of the applications to the Foreign Intelligence
Surveillance
Court was denied.

The NSA was created to conduct international surveillance – to intercept
and analyze phone calls, e-mails, faxes and other communications, searching
for threats to national security. The agency’s budget is unknown; a
federal judge ruled in 1999 that there was no requirement to reveal the intelligence
budget, of which NSA is a part.2 However, it has been estimated that the NSA’s budget is
$6 billion.3 The agency has said that if it (and its military alter ego the
Central Security Service) “were considered a corporation in terms of
dollars spent, floor space occupied, and personnel employed, it would rank
in the top 10 percent of the Fortune 500 companies.”4

The National Security Agency was created under a directive by President
Harry S. Truman in 1952.5 James
Risen explains in his 2006 book “State of War: The Secret History of
the CIA and the Bush Administration,” which details President Bush’s
secret NSA order in 2002, that President Truman created the agency “in
order to consolidate the government’s code-breaking and code-making
capabilities, and initially there were few legal limits on the NSA’s
ability to conduct domestic surveillance in the United States.”6 This changed after congressional
investigations in 1975 and 1976.

In 1975, the Senate Select Committee to Study Governmental Operations With
Respect to Intelligence Activities (more commonly known as the Church committee
because it was headed by Idaho Sen. Frank Church) and House Select Intelligence
Committee (called the Pike committee after its chairman, N.Y. Rep. Otis Pike)
began investigating reports of possible illegal, improper, or unethical activities
conducted by the FBI, the CIA, and the NSA.7 The committees learned of two
important NSA domestic surveillance operations: Minaret and Shamrock.

The NSA, originally created to spy on foreign enemies, began a domestic
watch list program called Minaret in the 1960s.8 The FBI, Secret Service, the military and the
CIA added names to this list of threats to national security.9 This
list included U.S. citizens or groups involved in civil rights and anti-war
activities -- including civil rights leader and minister Dr. Martin Luther
King, Jr.10 In 1975, NSA Director Lt. Gen. Lew Allen Jr.,
testified before the Church committee and revealed that the NSA intercepted
the phone calls of 1,200 Americans citizens’ over six years.11

The congressional committees also learned of another domestic surveillance
operation conducted during the 1950s and 1960s called “Shamrock.” This
involved an agreement where the major U.S. telegraph companies gave the NSA
every single telegram sent to or from the United States.12 This surveillance was conducted
with a warrant – the NSA merely asked the companies for the records
and they complied.13

NSA
employees were discouraged from discussing the warrantless
eavesdropping
program with news media, according to documents
obtained earlier
this month by EPIC under the Freedom
of
Information
Act.

These revelations led to the passage of the Foreign Intelligence Surveillance
Act (FISA) in 1978.14 FISA
established a separate legal regime for foreign intelligence surveillance
information in furtherance of U.S. counterintelligence. (Title III, also
called the “Wiretap Statute,” outlined the strict guidelines
regulating ordinary law enforcement surveillance.15) Congress specifically stated
that FISA and Title III “shall be the exclusive means by which electronic
surveillance ... and the interception of domestic wire, oral, and electronic
communications may be conducted.”16

James Bamford, in his 2001 book “Body of Secrets: Anatomy of the Ultra-Secret
National Security Agency,” explains that FISA “for the first
time outlined what NSA was and was not permitted to do. The new statute outlawed
wholesale, warrantless acquisition of raw telegrams such as had been provided
under Shamrock. It also outlawed the arbitrary compilation of watch list
containing the names of Americans. Under FISA, a secret federal court was
set up, the Foreign Intelligence Surveillance Court. In order for NSA to
target an American citizen or a permanent resident alien -- a “green
card” holder -- within the United States, a secret warrant must be
obtained from the court. To get the warrant, NSA officials must show that
the person they wish to target is either an agent of a foreign power or involved
in espionage or terrorism.”17 Subsequent executive orders
further limited the role of the NSA in the United States.18

James Risen’s book, the New York Times report last month, and subsequent
media reports have detailed President Bush’s secret 2002 order allowing
the NSA to conduct warrantless surveillance of international telephone and
Internet communications on American soil.19 President Bush disclosed the order to only a few Congressional
leaders and the presiding judge of the Foreign Intelligence Surveillance
Court, which issues warrants for domestic surveillance.20 These
officials were told not to discuss the secret surveillance program with anyone
else, making it difficult to question or provide oversight for the program.21

NSA employees also were discouraged from discussing the warrantless eavesdropping
program with news media, according to documents obtained earlier this
month by EPIC under the Freedom of Information Act.22 The documents, internal
messages from the agency’s director to staff, also defended the domestic
surveillance program.23

The current NSA program echoes the Shamrock surveillance program – including
the cooperation of U.S. communications companies. “Following President
Bush’s order, U.S. intelligence officials secretly arranged with top
officials of major telecommunications companies to gain access to large telecommunications
switches carrying the bulk of America’s phone calls. The NSA also gained
access to the vast majority of American e-mail traffic that flows through
the U.S. telecommunications system,” according to Risen.24

Last
year, the average cost of a wiretap was $63,011, up 1 percent
from the average cost in 2003.

In a national radio address on Dec. 17, 2005, a day after the first media
reports about the program, President Bush defended the warrantless surveillance
program. He said top administration officials, including the attorney
general and White House counsel, review the program every 45 days.25 After
the review, President Bush must then reauthorize the program to keep it
active.26 He has reauthorized the domestic surveillance
program more than 30 times, and he said, “I intend to do so for
as long as our nation faces a continuing threat from al Qaeda and related
groups.”27

A December 22, 2005 letter from the Department of Justice to members
of the House and Senate Intelligence Committees discussed the purported
legal authority for President Bush’s secret order. The letter contends
that the President has the authority to “order foreign intelligence
surveillance within the United States” and “[t]he President’s
constitutional authority to direct the NSA to conduct the activities he
described is supplemented by statutory authority under the AUMF [Authorized
Use of Military Force resolution, passed by Congress, September 18, 2001].”28 The
Justice Department also stated that the order was consistent with FISA.29

However, analyses by the nonpartisan Congressional Research Office and
a group of 13 legal experts and former government officials questioned
the Justice Department’s assessment. Both analyses concluded that
the Congress expressly intended for the government to seek warrants from
a special Foreign Intelligence Surveillance Court before engaging in such
surveillance when it passed legislation creating the court in 1978.30 President Bush’s assertion
that Congress authorized such eavesdropping to detect and fight terrorists
does not appear to be supported by the special resolution that Congress
approved after the Sept. 11, 2001, terrorist attacks, which focused on
authorizing the president to use military force, the analyses said.

“It appears unlikely that a court would hold that Congress has
expressly or impliedly authorized the NSA electronic surveillance operations
here,” and the Justice Department’s legal justification “does
not seem to be as well-grounded as the tenor of that letter suggests,” according
to the CRS report.31 The legal scholars and former government officials
stated, “Although
the program’s secrecy prevents us from being privy to all of its
details, the Justice Department’s defense of what it concedes was
secret and warrantless electronic surveillance of persons within the
United States fails to identify any plausible legal authority for such
surveillance. Accordingly the program appears on its face to violate
existing law.”32

If such surveillance of phone calls and e-mail is necessary, permission
can be obtained from the Foreign Intelligence Surveillance Court, which
reviews applications and grants orders for foreign intelligence gathering.
Administration officials have said that the requirement to apply for warrants
from the FISC hampers its intelligence operations and that sometimes they
cannot afford the delay created by the warrant applications.33 However, FISA allows for retroactive
warrant requests – up to 72 hours after they’ve begun.34 The
standard of proof required for warrants from the FISC is low; applicants
need only show probable cause that the subject is an “agent of a
foreign power.”35 Also, historically, the FISC only has rejected a handful of
requests; in fact, it rejected none of the applications for secret surveillance
in 2004.36

Another justification administration officials have put forth for
bypassing the FISC with the NSA domestic surveillance program has to
do with the vastness of the operation. Because the number of telephone
and Internet communications being monitored was so large, the officials
did not believe that they could obtain fast approval for all of them.37 The secret program did create a large list
of phone numbers and e-mail addresses linked to possible terrorists.
This list regularly was sent to the FBI, but virtually all of that
data led to dead ends or innocent Americans, according to officials
interviewed by the New York Times.38 “F.B.I. officials repeatedly complained to the spy agency
that the unfiltered information was swamping investigators,” according
to the New York Times.39

Under the federal wiretap laws, there are important reporting requirements
that provide information about electronic surveillance in the United
States. For example, the number of applications and orders for electronic
surveillance must be reported annually to the Administrative Office
of the United States Court and to Congress by the U.S. Attorney General.40 Under
Title III, the number and cost of interceptions of wire, oral, or electronic
communication conducted by federal and state agencies must be reported
to Congress annually by the Administrative Office of the United States
Court.41

Last year’s reports showed that surveillance activity conducted
by the United States has continued to rise dramatically since the Sept.
11, 2001 terrorist attacks, reaching an all-time high in 2004. According
to the Department of Justice’s 2004 Foreign Intelligence Surveillance
Act Annual Report, the Foreign Intelligence Surveillance Court granted
1,754 applications for secret surveillance in 2004, more than in any
previous year.42 No applications were denied
in whole or in part.43

A report issued by the Administrative Office showed that state and
federal courts authorized 1,710 interceptions of wire, oral, and electronic
communications in 2004, an increase of 19 percent over intercepts approved
in 2003 and the greatest number ever authorized in a single year.44 Federal officials requested 730 wiretap applications
in 2004, a 26 percent increase over the number requested in 2003.45 However, there are no reports provided on the use of the NSA’s
new surveillance authority to either the Congress or the public.

There are also public reporting requirements that document the cost
of legal surveillance in the United States by federal agents. These
annual reports provide information for the Congress and the public
to assess the value of electronic surveillance. For example, The Administrative
Office’s report showed that the average cost of state and federal
wiretaps in 2004 was $63,011, up one percent from 2003.46 The average cost of federal wiretaps (that
were reported) was $75,527, an increase of 5 percent from 2003.47 However,
the NSA’s secret domestic eavesdropping program was not reported
under the requirements of either Title III or FISA; therefore, as the
agency’s budget is unknown and the agency fails to comply with
the requirements of other federal agencies that conduct surveillance
in the United States, the amount of taxpayer dollars spent by the NSA
on this program is unknown.

In 1975, when Sen. Frank Church opened the committee hearings that
would reveal the Shamrock and Minaret domestic surveillance programs,
he said,

We have a particular obligation to examine the NSA, in light of its
tremendous potential for abuse. . . . The interception of international
communications signals sent through the air is the job of NSA; and,
thanks to modern technological developments, it does its job very well.
The danger lies in the ability of the NSA to turn its awesome technology
against domestic communications.48

The National Security Agency again will undergo Congressional scrutiny
on February 6, when the Senate Judiciary Committee begins its hearings
examining the justifications of the Bush administration and the actions
of the NSA in conducting this secret domestic eavesdropping program.49 Apart
from the important questions raised by the Committee Members about
the legality of the NSA program and the consequences of a possible
determination that public officials violated the FISA, EPIC also urges
the oversight committee to consider the importance of establishing
reporting requirements for the NSA that are comparable to other federal
agencies that conduct surveillance in the United States.

5 President Truman
wrote a memorandum about intelligence activities and issued “National
Security Council Intelligence Directive Number 9, Revised” on
Oct. 24, 1952 (Memorandum on Communications Intelligence Activities
(Oct. 24, 1952), available athttp://www.nsa.gov/truman/truma00001.pdf);
On Nov. 4, 1952, less than two weeks after President Truman issued
the memorandum, the NSA was created (Thomas L. Burns, Center for
Cryptologic History, The Origins of the National Security Agency
1940-1952, 107 (1990), available athttp://www.thememoryhole.org/nsa/origins_of_nsa.htm).

6 James Risen, State
of War: The Secret History of the CIA and the Bush Administration
42 (2006).

7 James Bamford,
Body of Secrets: Anatomy of the Ultra-Secret National Security Agency
434 (2001).

28 Letter from
Assistant Attorney General William E. Moschella to Chairman Roberts
and Vice Chairman Rockefeller of the Senate Select Committee on Intelligence
and Chairman Hoekstra and Ranking Minority Member Harman of the House
Permanent Select Committee on Intelligence (Dec. 22, 2005), available
athttp://www.epic.org/privacy/terrorism/fisa/nsaletter122205.pdf.